Blain’s Morning Porridge – July 12th 2021: So Much for the UK to be Positive About!
“That cold black cloud is coming down…”
This morning: The football is finished. Get over it. There is much more positive stuff to follow! The UK has many issues to overcome, but we are a nation generally comfortable with ourselves, secure in our future and full of promise. This is the time to be investing in UK Inc – not writing us off because England dropped ball in the penalty lottery, again!
Even the weather was crying this morning. A long dark cloud of soaking, wet despondent rain drenched the nation as we, (yes, this Scotsman shares England’s pain), woke up to the truth England got penalties wrong again. Apparently, Saka had never taken a penalty except in training! Turquoise proved an unwise colour choice for either Rashford or Sancho’s boots.
Whatever.. Get over it. The sun has come up! It was just a game. England lost to… it doesn’t actually matter that Italy won. Well done to them – to triumph in Wembley is a massive achievement. Being a Rugby fan, I know nothing about Football…. But Italy looked good. So did England.
So, what’s the good news? That England got to the final but lost in a penalty lottery? That the whole country – even many rebellious Scots and Welsh – were behind the team? That the pubs sold 13 million pints yesterday? That the whole nation was and still does exude confidence?
We may not have liked the score, but we liked what we saw! England stood taller as the tournament progressed.
Today we’re nursing hangovers tinged with what ifs.. Tomorrow we will be back to normal – the same old, same old…. Which Tory minister will be caught with this snout in the trough next, what crown jewel will be snapped up by a US hedge fund or a Chinese state company for a pittance, or maybe Europe says something profoundly stupid and peeves us just a little too much..…. We shall shock them with a sharp warning bite.
Nemo me impune lacessit – as we Scots like to say.
But, maybe, just maybe, there will be something more. I sense rising confidence in UK Inc. It isn’t just about football. It’s a nation increasingly comfortable in our own skin and increasingly confident about our abilities and future. There is much to fix – but maybe this time we shall.
This time, there is much more to this rising sense of Britain finding its way again than the trite and empty Blairite veneer of “Cool Britannia”. This time it’s going to be “Smart, Clever, Effective Britain”, the nation the world will want to deal with. Just because Boris bumbles from gaffe to gaffe doesn’t mean the nation has to..
Wake up and be proud of what we are. I was a reluctant Brexit voter – and its increasingly clear that despite the burdens and high costs Europe will put upon us for leaving, getting rid of the EU’s red tape and hamstrung governance will ultimately prove an incredible long-term win for the UK. Of course, a better solution will be a new cooperative, beneficial relationship with Europe, and I suspect that will happen swiftly as the remaining cadre of Brexit politicians are purged and replaced with newer unsullied models. I predict Boris won’t be around that much longer.
Our success in vaccinations, our leadership in the war against Covid, our ongoing contribution in terms of the academic underpinnings of global growth across tech, medicine and design.. you name it, there is much for the UK to be deeply proud of. Football didn’t create that, but the success of the English team, and also Wales and Scotland, not forgetting our countrymen in Northern Ireland, opens doors.
And this is happening at the right time – as markets are opening up to reality and adopting an element of sanity.
I get the sense that many “serious” investment professionals have had enough of the ongoing current distortions. They understand why stocks and bonds are mispriced on the back of QE, interest rates and intervention – the see it everywhere they look.
They are increasingly hostile to the blatant touting of the IPO/SPAC bubble. Privately many are sick of being told what they can and can’t invest in because their marketing teams have gone all-in on the ESG/Sustainability buzz. Because a government decides to call a bond green, does not make it green, Meanwhile, the manic herds of meme-stock traders are still bouncing round the markets believing whatever merde the reddit boards tell them to believe.
The story of Liontrust, a very earnest ESG investor abandoning its IPO because it simply could not find investors is a clear signal we’re already past Peak-Sustainability. Apparently over 2000 private investors signed up, but the institutional money was disinterested in yet another ESG investment fund. (There was also an element of cannibalism in that Liontrust already has a number of similar funds out there investing in the same stuff.)
It’s no wonder so many smart market watchers are giving up, packing up their desks and looking to take a break in July and August. If I could join them I would – but some big things going on…. (The Porridge will be intermittent through August..)
Perversely, peak cynicism and a disinterested market is actually a great time to get involved and start digging for opportunities. It’s when the serious money has had enough of being told a piece of semi-developed IP scribbled on a fag-packet, or a half-considered concept are worth billions. Or that an old idea dressed up with lots of meaningless jargon about “defi”, “tech-driven”, or “cloud enabled” basically boils down to ordering expensive groceries off the net…
Its times like this, when the smart money pendulum is swinging from absurd optimism back towards the value of careful and pragmatic expertise and experience, is when the value of investing in the great ideas so often obscured by investment fashions – like ESG, Sustainability, IPOS and SPACS – show up as being much better concepts and better value.
Investing is rising confidence and real business is a very smart game – and confidence in the UK, is a great example of where to find the next generation of rising firms. Time to buy UK!
I’ve got to be careful about what I say about this – because it involves a fund that Shard Capital AIFM manages. I’d tout the Fund as a great example of expertise and experience, with a clear programme of investing into growth and rising confidence within the UK.
Sure Valley Ventures (SVV) is launching its second venture capital fund aiming to identify and develop the next generation of UK software tech unicorns. Uniquely, the fund will be anchored by the British Business Bank backing an exceptional profit share deal for investors that’s pretty much unavailable elsewhere. (Note: I’m invested personally in the SVV No 1 fund.)
The fund’s concept is to target key disruptive tech with high growth prospects – which is pretty much what every disruptive tech fund says. But SVV has the right folk with the right backgrounds on board to add genuine value. Their USP is to choose carefully to catch the fourth tech wave in the UK by investing in the right opportunities in: Artificial Intelligence, Immersive Tech like AR/VR, the Internet of Things IOT, and Security (cyber and info). They look for firms with significant IP and a clear new market with the aim of moving from seed finance to Series A in 24 months. It’s worked rather well on their first fund.
I won’t go into the details on the Morning Porridge, but we’re already looking at upscaling the deal, and I’ll be happy to send round the details to professional investors. Contact me on firstname.lastname@example.org.
Sorry if the above paragraphs read like naked marketing, but this is the dawn of the Age of Clever Britannia!
Five Things not related to Football to Read this Morning
Out of time and back to the day job!
Strategist, Shard Capital